Thank you for reading EUobserver!

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

Gunnar Hokmark, the Swedish centre-right MEP charged with piloting draft legislation on a pan-EU bank resolution regime through parliament, has said that MEPs will push for compulsory bail-ins of large deposits to be enshrined in the new law.

Hokmark told Reuters in an interview on Tuesday (26 March) that "deposits above €100,000 are not protected and shall be treated as part of the capital that can be bailed in."

MEPs on the economic affairs committee are expected to vote on a text to negotiate with government ministers in April.

Under existing EU law on deposit guarantee schemes, countries are required to protect the first €100,000 of savings in the event of a banking crisis.

However, even this principle was recently challenged by the initial plan to slap a 6.75 percent levy on deposits worth between €20,000 and €100,000 as part of the Cypriot rescue package.

Some of the more hawkish member states, including Germany and the Netherlands, are believed to support measures to see investors and savers take a larger share of the burden to reduce the costs to other taxpayers.

The €10 billion bailout for Cyprus is contingent on the country putting together a self-funded contribution of up to €7 billion.

The bulk of the money will be raised by winding down Laiki, Cyprus' second largest bank, and by applying a haircut of up to 40 percent on wealthy savers at the island's largest lender, the Bank of Cyprus.

The rescue package marks the first time that bank depositors have been targeted as part of a bailout deal.

More fuel was added to the fire after Eurogroup chief, Jeroen Dijsselbloem told reporters that the Cypriot bail-in model could serve as a "template" for future bank restructuring in an interview with Reuters and the Financial Times on Monday.

Dijsselbloem commented that: “If there is a risk in a bank, our first question should be 'OK, what are you in the bank going to do about that? What can you do to recapitalise yourself?"

“If the bank can't do it, then we'll talk to the shareholders and the bondholders, we'll ask them to contribute in recapitalising the bank, and if necessary the uninsured deposit holders," he added.

Dijsselbloem was quickly rebuked by two members of the European Central Bank's governing board.

ECB board member Benoit Coeure told France's Europe 1 radio on Tuesday that "Dijsselbloem was wrong to say what he said ... Cyprus isn't a model for the rest of the euro zone."

Austria's Ewald Novotny described the Cypriot deal as "no model for other instances."

For his part, Dijsselbloem later issued a statement indicating that Cyprus is a "specific case."

But his remarks also prompted French President Francois Hollandeto enter the fray. "The guarantee of deposits should be an absolute, irrevocable principle," he told French media on Tuesday.

Central European countries say they have "nothing to hide" on rule of law issues - while justice commissioner Vera Jourova said they should agree to the Commission's controversial budget plans on rule of law conditionality.

Giovanni Buttarelli, the European data protection supervisor, says the EU-US data sharing pact known as Privacy Shield will play an increasingly minor role given the general data protection regulation.